There is no way the shorts profit from this trade. Most shorts started shorting NEOP at 1.80 a couple of years ago. Their basis is probably under 1,10 by now. The stock has bottomed at 2.30-2.40. The shorts are effed and even they know it. The ones who said time was against the shorts were right.
I'll give you the fact that someone who was short for the time frame would be underwater, but I don't believe you have a situation of one entity holding short all this time. Instead, you can follow short interest which went to a low of about 13 million a few months ago before springing up to 24 million. This indicates that many shorts had bought to cover, and since the FDA approval many new short positions were opened. Thus the shorts from before that were underwater closed their short position at a loss, and new shorts have subsequently been initiated, and most likely at a gain since the price was up near 4 dollars.